Why Keep Renting? It seems Cheaper to buy!, by Yvonne McFadden.

By Yvonne McFadden

Why keep Renting? It seems cheaper to buy!

So, renting has its perks, more so if you have a flexible lifestyle. You can move around, experience different places at any given time.

In the long-term, however, you have to consider whether renting is financially feasible. It might not seem much at the time, but rent adds up over a long period and can be very financially draining.

Besides, rent is money that you cannot get back. Money that is most probably paying off someone else’s mortgage and building them equity instead of you. Undeniably, buying a home is a considerable investment that requires a lot of capital. Still, when you consider the initial expense with the cost of renting, the two are pretty comparable.

And let’s face it, rent is never the same at any given period. Rent, unlike monthly mortgage payments, is subject to change - subject to inflation. The uncertainty comes with the possibility of a rent increase that is most off-putting when it comes to renting.

Rent has risen by 37 percent since 2000, which experts expect to go even higher post-pandemic. It is forecasted that rent this year could be higher than it would have been if the pandemic never happened. In 2020, renting Americans enjoyed rent reductions and, in some cases, lived rent-free as their landlords struggled to fill empty units. However, with the economy recovering and as more people get vaccinated, landlords will hike their rents.

The housing cost, pre-pandemic, was rising, something that the pandemic has made worse.

According to a report from Apartment List, in 2021 alone, rent has increased by 11.4 percent compared to the 3.3 percent increase experienced in the first six months of 2017, 2018, and 2019.

Depending on what type of mortgage you go for, the monthly mortgage payments are the same every month until you finish paying off the house. That can give you some sense of stability, and it makes it easier to successfully budget every month. When considering buying or renting, you should consider whether your rent outweighs the probable mortgage you will pay once you buy your home.

In 2019, homeowners paid $7,229 in terms of mortgage and interest. On the other hand, renters paid $11,979 in rent. Therefore, homeowners spent $4,750 less than renters. Keeping that in mind, rent will be out of reach for many American households. However, it might also be the last push that you may need to finally buy yourself a home.

In addition to this, rent takes up more from the household income than any other expense. Pre-pandemic, 18 million Americans spent over half of their income on rent; that is, 1 in 7 Americans. Renting, therefore, can be a cost burden to many. On average, a household that makes a monthly income of $6,904 spends $4,341 on expenses, and of these $1, 723 goes to paying rent.

If you are considering buying a home, know this, interest rate cuts are favoring homeowners. Low mortgage rates have created an environment where affordability is critical. By purchasing the home, you give yourself stability, and you certainly take a step closer to financial freedom. Owning a home allows you to earn equity on your property. You can cash in on this equity later in terms of more credit. Buying a home is a sound and significant investment. Undoubtedly, it is a huge step, and it can be intimidating. But The Power Is Now Media Inc. has a faculty of qualified real estate agents that will find you a good home for a reasonable price. There are also mortgage brokers with years of experience that will find you the best deal—Head to https:// www.thepowerisnow.com/.

ABOUT THE YVONNE MCFADDEN

Yvonne McFadden is a veteran in the real estate industry. Her business has spanned for over 30 plus years. Her clients range from all walks of life. She even recently added a foreign presence by becoming licensed in Dubai. She has fun with her clients while making one of the most important decisions of their lives. She takes time to explain the process to guide them through tough decisions. If you are looking to invest in real estate in the Arizona area reach her at https://www. thepowerisnow.com/.

Additionally, of you happen to be in the Riverside area, reach out to Eric Lawrence Frazier, MBA, at 800-261-1634 ext. 703. He has had a rich career in the real estate industry, with years of experience as a mortgage advisor.

ABOUT THE POWER IS NOW MEDIA

The Power Is Now Media is an online multimedia company founded in 2009 by Eric L. Frazier, MBA, and is headquartered in Riverside, California. We are advocates for homeownership, wealth building, and financial literacy for low to moderate-income and minority communities. The Power Is Now Media corporate office is located at 3739 6th Street Riverside, CA 92501. Ph.: 800-401-8994 Website: www.thepowerisnow.com

Eric Lawrence Frazier, MBA. President and Founder, The Power Is Now Media

Word cited

https://www.usatoday.com/story/money/2021/09/01/buy-rent-starter-homecheaper-real-estate-housing-markets/5610088001/ https://www.fool.com/the-ascent/research/real-cost-renting-owning/ https://nypost.com/2020/02/04/more-americans-are-spending-over-half-theirincome-on-housing/